Case Study Flashcards
How was the project procured, was it from a framework?
The project was procured through a framework amongst several other projects within the AMP7 arrangement. Each of the projects is procured on a Design and Build methodology.
How amended was the standard form of the NEC3 Contract?
The majority of clauses has slightly amended wording with numerous amounts of deletions, additions and substitutions. An example of this is the compensation events, such as the deletion of clauses 60.1 (12 and 13). Additionally, amended payment provisions to suit the frameworks agenda.
How did the pain/gain mechanism operate on the contract?
If the actual costs incurred are less than the target cost, the contractor is entitled to a share of the “gain”. Conversely, if the actual costs exceed the target cost, the contractor will bear the “pain”.
Specifically for Station Road, the pain/ gain mechanism operated on a 50/50 split with a band of £759K. If the gain band was exceeded, the Contractor received a further 0%. If the pain band was exceeded, the Contractor received an further 50%, meaning 100% of the pain.
Can you explain how the joint venture operated, was it an incorporated JV?
The JV was an unincorporated JV comprising of MWHT and JMS. JMS provided the direct labour and plant for most of the projects where a subcontractor was not utilised. Both companies combined but did not register Advance Plus as a registered company.
What is the difference in an ‘Incorporated JV’ and ‘Unincorporated JV’?
Incorporated is the creation of a legal entity between the Parties VS Unincorporated is purely contractual as there is no vehicle for them to each trade under.
Who were the designers for the project?
The designers for the project were MWH and JMS. MWH have an additional section of the business which covers the civil, mechanical, electrical and process design for each project. JMS also has a smaller pool of designers to assist in the process, more specifically temporary works design.
Can you explain which risks were borne by the client and by the contractor?
Clients are stipulated in CD Pt 1:
Client: Local Authority impacting the proposed construction methodology, any works associated with the forest school and any nesting birds that prevent tree removal for the works.
Contractor: Ground conditions, weather, design, programme (LD’s) and quality.
Shared risk of cost due to Option C Contract.
Who was the NEC PM?
The NEC PM was a Project Manager for the client who was seconded in to oversee various projects.
What was the allowance for the welfare building in the contract activity schedule/target based upon?
The specification of the building remained the same; brick constructed welfare building with a kitchen, washroom and laboratory. It was based on a subcontractors quotation 2 years prior to retendering.
Did you have to seek client approval for sub-contract appointments? If so, what did you do to expedite these efficiently?
Yes, we would submit documentation for approval to the client via CEMAR which contained our various internal checks carried out on the subcontractor prior them carrying out the works. Checks include H&S, acceptance of NEC3 terms and D&B scoring.
Was the planning approval documentation issued to the client on time?
Yes, it was submitted two weeks prior the planning application submission milestone which is stipulated in the EWI.
Can you outline the contents of the Early Warning for the planning delay?
It referenced correspondence received that the Local Authority have objected to the panning application and further states that a delay in the client responding will result in a delay to our programme. It also references where in the EWI it is an Employers obligation to progress with planning approval once the Contractor has submitted.
At the time of the planning delay where was your planned completion date in relation to the contractual completion date?
Both planned and contractual completion dates were the same at this stage, give or take a couple of days. The planning delay would push our planned past the current contractual position.
At the time of the planning delay were you forecasting an under or over-spend against the target?
We were forecasting an underspend against the target cost. The effects of the planning delay kept us in a gain position, albeit close to the pain threshold.
If the planning approval was a client risk, why would a delay on the project expose you to liquidated damages?
It would have potentially exposed us to LDs at the time of the Early Warning had the client pushed back on us with the information we provided them. This never became apparent.
